Chelsea Lee runs the sales division for a local auto insurance firm. One of her key duties is to ensure the company has 10 percent market share by the end of the year. When evaluating the current sales numbers, she determines that her sales division has total sales of $3 million and the entire industry has total sales of $50 million. What additional sales must Chelsea Lee's division meet to ensure they have 10 percent of the market by the end of the year?A. $2 millionB. $1 millionC. $5 millionD. $10 million

Answers

Answer 1

Final answer:

Chelsea Lee's division currently holds a 6% market share. To achieve a 10% market share, her division needs to make $5 million in sales. Therefore, the division needs an additional $2 million in sales.

Explanation:

This question is asking about the concept of market share. Market share is the portion of a market controlled by a particular company or product. In this case, Chelsea Lee's division of an auto insurance firm is aiming to control 10% of the market. Currently, her division has total sales of $3 million while the entire industry's sales total $50 million. Her company's market share can be calculated as ($3 million / $50 million) x 100 = 6%.

To achieve 10% market share, the firm's sales needs to be 10% of the total industry sales. This would be calculated as $50 million x 0.10 = $5 million. Since her division currently has $3 million in sales, they would need an additional $2 million ($5 million - $3 million) in sales to achieve a 10% market share. Therefore, option A: $2 million is the correct answer.

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Related Questions

Which of the following ethical theories is adopted by a company that strives to act as ethically as possible, even at the expense of some additional profits, as long as the business remains profitable?a. The maximizing profits theory b. The invisible hand theory c. The moral minimum theory d. The competitive advantage theory

Answers

Answer:

c. The moral minimum theory

Explanation:

The moral minimum theory is a principle that statutes that a business should do NO intentional harm or do the minimum harm possible in order to consider its behavior the minimum required for ethical behavior.

I hope you find this information useful and interesting! Good luck!

Final answer:

The theory consistent with a company prioritizing ethical behavior over additional profits is the moral minimum theory, which maintains a baseline of ethical conduct while ensuring profitability.

Explanation:

The ethical theory adopted by a company that strives to act as ethically as possible, even at the expense of some additional profits, is most aligned with the moral minimum theory. This theory suggests that companies should aim to do no harm, and should engage in ethical behavior even if it impacts their profits, provided they remain profitable. The theories such as maximizing profits theory, invisible hand theory, and competitive advantage theory may all entail profit maximization as a primary objective, which does not align with sacrificing profits for ethical considerations.

Cole has a cold. Although the brand-name drug is more expensive than the generic, he buys the brand-name one. Cole is familiar with the brand-name drug and knows exactly what to expect whe

Answers

Answer:

less risk

Explanation:

Note: The question appears to be incomplete. Another similar question has been attached for reference purpose and the answer provided herein is based upon that.

It is common consumer behavior of sticking to a brand name despite another lower cost option providing the same base or constituent. Particularly in case of necessities, the law of demand i.e lower price higher demand fails as consumer would prefer being exposed to lesser risk no matter whatever be the cost.

In the given case, the consumer i.e Cole prefers going with a brand name as it provides him with a higher degree of assurance as the brand has a certain reputation attached to it which the other generic option lacks.

Secondly owing to his familiarity with the drug and it's past usage experience, he has developed brand loyalty apparently.

Thus, Cole's decision is attributable to less risk.

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